The Different Means Of Payment: Advantages And Disadvantages

Are you sure you know the different payment methods available to you? Whether online or in-store, offering varied payment methods adapted to your target audience is essential for your business. Otherwise, you risk losing buyers at the last stage of your customer journey.

The Credit Card

The bank card is the favorite means of payment for the French: 71% use it to make their purchases, both online and in stores. It is also the most widely used payment instrument in E-Complish for example. 

Thus, whatever your field of activity, we strongly recommend you set up the necessary tools to accept payments by credit card. Depending on the payment solution you opt for, you will not be able to accept the same payment cards. Here are some examples of the players present in the market:

Visa: it is the world leader in publishing bank cards; it holds 60% of the market share (Reuters). This would be it if you could only accept one type of card. 

Mastercard: it is the second bank card distributor, holding 30% of the market share. Like Visa, Mastercard offers a wide range of credit cards to suit the greatest number.

American Express: the company adopts a different positioning from its two main competitors by targeting a more “upscale” clientele (minimum salary of €20,000 gross per year). It holds 8% of the market share. Learn reason Why Businesses Need an IVR System here.

The Advantages Of The Credit Card:

Optimized cash flow: even if your client does not have sufficient funds in his account, once the transaction is accepted, you are sure to be credited and able to access your funds quickly.

Various functionalities: payment solutions allowing you to collect credit card transactions on your site generally offer many tools to optimize your conversion. Customizable payment pages, one-click, deferred, split payment: you’re spoiled for choice!

Limited contacts in store: if your payment terminal is equipped with NFC technology, you can accept contactless payments and thus streamline the checkout process. This is a practice currently encouraged since the ceiling for these payments went from €30 to €50 on May 11. 

The Inconvenient: 

Capped expenses: if you sell products at a high cost, for example, in the B2B field, it is better to accept bank transfers and checks, for example, in parallel.

Transaction fees are the interbank payment commission (CIP), an amount your bank deducts each time a customer pays you by credit card. The CIP comprises a variable part freely chosen by the banks and a fixed part determined by the regulations.

Cash Payments

It is the second most used means of payment for in-store purchases (Payments Europe). On the other hand, it is only used for 7% of online purchases, in the case of payment on delivery or collection in-store. 

The Benefits Of Cash: 

Speed ​​and ease of use: with cash payments, you have the sum immediately, which allows you to have a better view of your cash flow. 

Absence of transaction fees: for this reason, some merchants impose a minimum amount for payments by credit card. This practice is legal as long as the information is displayed in your store. However, it may cause you to lose customers who do not have cash on them or prefer to pay for their purchases by credit card, even for small amounts.

The Inconvenient

Spending capped: payment in cash is regulated. A business is not authorized beyond €1,000, for example, the threshold introduced in 2015 to fight against terrorism and money laundering.

Longer checkout time: Handling cash can make checkout longer. Your customer looks for the money in his wallet, checks the amount you have returned to him, etc. Which, in turn, can create queues in your store. 

Risk of fraud and theft: in 2019, the European Central Bank withdrew 559,000 counterfeit banknotes from circulation. The risk of fraud is, therefore, real, as is the risk of theft. 


Paul Petersen

Paul Petersen